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BANGALORE: Flipkart has raised the biggest round of funding by an Indian Internet firm, setting the stage for a battle with Amazon for supremacy of the Indian online retail market. Singapore's sovereign wealth fund GIC became the latest investor to put its faith in India's largest online retailer by participating in the $1-billion (.`6,000 crore) funding round that values Flipkart at $7 billion.

ET was the first to report that the Bangalore firm had snagged the massive round of funding. "We were a little kid waiting to grow up. Now we have grown up with this funding," said Sachin Bansal, the co-founder & CEO. If Flipkart were listed in India, it would count among the 50 most valuable firms with twice the market value of Colgate, which was set up here in 1937.

The funding was led by existing investors Tiger Global and Naspers with participation from Accel Partners, DST Global, Iconiq Capital, Morgan Stanley Investment Management and Sofina. Dragoneer and Vulcan Capital, who first invested in the company last year, did not take part in this round. The seven-year-old company has so far raised over $1.7 billion in risk capital. In May, it sucked in $210 million led by Russian billionaire Yuri Milner's DST Global a few days after announcing its acquisition of fashion portal Myntra for an estimated $370 million.

Sachin, who has in the past spoken of a US listing in 2015, said an IPO is not on the cards for the next two years.

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This funding ensures that Flipkart can now invest in building on the promise they have shown," said Arvind Singhal, chairman of retail advisory firm Technopak. "I do not think this funding would have caught Amazon by surprise and I am sure Flipkart is not naive to now take competition lightly." Seattle-headquartered Amazon, which just announced second-quarter loss of $126 million, has become increasingly aggressive in India. In about 13 months it has launched 28 categories of products and has grown to host 8,500 merchants on its platform. On Monday, Amazon announced the opening of five more warehouses, almost doubling its storage capacity to over half-a-million square feet.

The funding will mean more pressure for Delhi-based Snapdeal, which raised over $233 million from investors such as Temasek and Premji Invest earlier this year. Amazon has matched Snapdeal in terms of sales, with the two firms having sold about $600 million (over Rs 3,600 crore) worth of products each, according to multiple people who have direct knowledge of the firms' financial details. Both could reach $1 billion in sales this fiscal. Flipkart reached this milestone last fiscal.

But Sachin said his focus is solely on Flipkart. "At Flipkart we are not thinking about competition. This funding gives us the opportunity to shape the market in a way that we want," he said.

Binny Bansal, 31, co-founder and chief operating officer, said logistics as well as payment and mobile technologies will be the areas where Flipkart expects to spend the most. Also getting attention will be small businesses, which Flipkart will handhold and bring online.

Mobile has become a priority area for Flipkart, with over 50% of sales through handheld devices. So are payments, where it could look at acquiring a firm.

Flipkart has previously acquired for depth in product categories and for new technology. This could continue, said experts. "There could be more acquisitions to fill up adjacencies in product or capability. If someone is strong in a segment, they could become an acquisition or merger target," said Pinakiranjan Mishra, partner and national leader (retail and consumer products) at EY.

Apart from tech buyouts, the company could look at acquisitions in categories such as furniture. Portals such as Pepperfry and Urban Ladder, which raised funding in the past few weeks, are seen as likely targets.

Flipkart's most recent acquisition, fashion etailer Myntra, has worked out well for them so far. "Fashion is now our largest category accounting for one-third of our sales," said Sachin. The combined entity claims to now command over 50% of the online fashion market.

Such strategic decisions will become more important now. "This will not make life easier for the company. They will need to show results," said Technopak's Singhal.